Farmers in Punjab spend 30 per cent share of loans on domestic needs, health and education

It has come to light that though the farmers have incurred major debt for purchasing farm implements but domestic needs are the second major purpose of debt incurred by marginal farmers (having less than one hectare of land) and small farmers (up to two hectares).

A RECENT study has revealed that farmers, failing to make ends meet, have been spending around 30 per cent share of their total debt towards meeting their domestic needs, like maintaining families, repairing houses, on health, education and socio-religious purposes.

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The recent survey, Indebtedness among Farmers and Agricultural Labourers in Rural Punjab, was conducted by the professors of Punjabi University Patiala and sponsored by the Indian Council of Social Science Research, New Delhi. The survey was conducted in several villages of three regions in the state – south-west (Mansa district), central plains (Ludhiana) and Shivalik foothills (Hoshiarpur) – in which farm households have been categorised as marginal, small, semi-medium, medium and large.

It has come to light that though the farmers have incurred major debt for purchasing farm implements, including 72.97 per cent, 69.82 per cent and 61.97 per cent in central plains, Shivalik foothills and south-west regions, respectively. But domestic needs are the second major purpose of debt incurred by marginal farmers (having less than one hectare of land) in all three regions and small farmers (up to two hectares) in the South-West region.

The share of domestic needs in total debt is around 7 per cent and it ranges from 6.52 per cent and 7.69 per cent in central plains and Shivalik foothills, respectively, while it is 7.39 per cen in the south-west region and mostly small farmers have borrowed more for this purpose from non-institutional organisations like commission agents, private moneylenders, etc.

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Similarly, around 8 per cent of the total debt is owed for the purpose of carrying out major repairs and house construction by around 12 per cent farmers in the south-west region against 8.17 per cent in the Shivalik foothills and 4.61 per cent in the central plains.

Also, farmers have been spending 6.74 per cent share of their total debt on socio-religious ceremonies. In the Shivalik foothills, 7 per cent of the total debt has been spent on educational purposes.

“The field survey has brought out the fact that farmers cannot get alternative employment opportunities. So, they take some land on lease from large farmers to increase the size of their operational land holdings and for that purpose, they also need funds to grow crops but still they were unable to meet the expenditure with their income and taking loans to maintain the families even and the situation is more alarming in case of small and marginal farmers,” said Professor Gian Singh of the Department of Economics at Punjabi University, Paiala, who had conducted this survey along with Professor Anupama Uppal, Department of Economics, Professor Gurinder Kaur of the Department of Geography, Assistant Professor Rupinder Kaur, of Punjabi University and Assistant Professor Sukhvir Kaur Dashmesh of Khalsa College, Zirakpur.